Everything Everywhere Wins Permission for Faster Network

Deutsche Telekom AG (DTE) and France Telecom SA (FTE)’s U.K. mobile-phone venture gained permission to run faster data services on its current airwaves, removing a hurdle to its plan to begin operating a so-called 4G network this year.

Everything Everywhere, the country’s largest wireless operator, can use licenses in the 1,800 megahertz spectrum to deliver the faster connections, U.K. regulator Ofcom said in a statement. The venture, which uses the Orange and T-Mobile brands, said it plans to deploy the high-speed technology by the end of this year and unveil a third brand.

The decision lets Everything Everywhere get a head start on Vodafone Group Plc (VOD) and Telefonica SA (TEF), which are waiting for more frequencies to become available at an auction before starting their own faster services. The auction of 800 MHz and 2,600 MHz frequencies is set to begin later this year, allowing a general rollout of faster data services in 2013, Ofcom said.

Allowing Everything Everywhere to use the frequencies will deliver significant benefits to consumers, and “there is no material risk that those benefits will be outweighed by a distortion of competition,” Ofcom said. “Delaying doing so would therefore be to the detriment of consumers.”

Vodafone Response

Vodafone said today it was “shocked” by Ofcom’s decision. The regulator didn’t “properly regard the competitive distortion created by allowing one operator to run services before the ground has been laid for a fully competitive 4G market,” the carrier said in a statement.

Everything Everywhere will operate a third brand alongside Orange and T-Mobile, the company said today. The venture is also in advanced talks with Hutchison Whampoa Ltd. (13)’s Three over a sale of part of its spectrum holding to meet demands of European Union competition authorities, according to two people familiar with the matter, who declined to be identified because the discussions are confidential.

The spectrum, which won’t be handed over until September 2013, will be used for 4G services, one of the people said. Officials for Everything Everywhere and Three declined to comment on the talks, which were reported earlier by the Financial Times.

To contact the reporters on this story: Cornelius Rahn in Frankfurt at crahn2@bloomberg.net; Jonathan Browning in London at jbrowning9@bloomberg.net

To contact the editor responsible for this story: Ville Heiskanen at vheiskanen@bloomberg.net

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